Brexit cherry-picking is inevitable — but it will cost

LONDON — Brexit cherries are there to be picked. The only question is how much to charge for them.

Across Europe, the very idea of cherry-picking is met with horror. “Keine Rosinenpickerei!” demands Berlin. The fruit might be different (raisins) but the message is the same: The EU’s orchard of goodies is for members only. No ifs, no buts.

The European single market’s golden (if patchy) four freedoms of people, capital, services and goods are indivisible. “À la carte” access, as EU Brexit negotiator Michel Barnier is fond of putting it, isn’t an option.

Except, that’s not really the case — it just depends how you define the cherries.

In Whitehall the talk of cherry-picking is met with a roll of the eyes. “We’ve conceded the point,” said one U.K. official. “That’s why we’re leaving the single market.” For the U.K. it is now simply a question of mutual self interest to agree a comprehensive trade deal keeping barriers as low as possible.

One EU27 diplomat who spoke to POLITICO on condition of anonymity agreed that the cherry-picking rhetoric was past its sell-by date. “It is not helpful,” the official said. “Every single free trade agreement involves cherry-picking. That is what they are.”

And yet European officials are happy to offer cherries (of a kind) where it suits them, say British officials.

The official, who works closely on his country’s Brexit preparations, said such binary rhetoric stood in the way of the real choice facing the EU: how to ensure life outside the club is worse for the U.K. than before. In other words, how much to charge the U.K. for a trade deal.

German Chancellor Angela Merkel warned early on of the dangers of British cherry-pickers. “One cannot lead these negotiations based on the form of ‘cherry-picking,’” Merkel said in a Cologne speech in January last year, well before the Brexit negotiations got underway. “This would have fatal consequences for the remaining 27 EU states.”

And she has made the requirement for Britain to pay a demonstrable price crystal clear to EU leaders at the European Council, according to the EU diplomat who did not want to be named. “Everyone is clear this [new relationship] cannot translate into absolutely no change, particularly if the British are insistent on restricting free movement,” he said. “But what does this mean? We don’t know yet.”

On this fundamental question — how to limit the scope and depth of Britain’s new trade deal — there has not yet been a formal discussion among the EU27, the diplomat said. The EU’s pound of flesh, as it stands, is unknown.

For the EU, whatever price they set on Britain’s post-Brexit access is problematic because it inevitably comes with costs attached in return, which will not be shared out equally among the 27, some of which have highly integrated economies with the U.K. while others do not.

The retort from the EU side is that they cannot name the cost of something if Britain is unwilling to say what it wants. “[The] time has come to make [a] choice,” as Barnier put it on his visit to Downing Street Monday.

And yet European officials are happy to offer cherries (of a kind) where it suits them, say British officials. From the Erasmus exchange program to joint space projects, there is a willingness in Brussels to consider joint projects after Brexit before the outlines of a future relationship have been set.

“We have always signaled that — on Horizon 2020/Erasmus/innovation — third country cooperation exists,” one EU official said. “The U.K. can continue to take part under different financial and legal conditions compared to today once it has left.” This kind of pay-as-you-go relationship with the EU doesn’t count as cherry-picking in Brussels’ terms because these programs are not core to the single market.

But, counter the Brits, any free-trade agreement involves access to the single market. The CETA deal with Canada, for example, abolished 98 percent of EU tariffs on Canadian goods. It cuts tariffs on Canadian forestry and wood products from 10 percent to zero and also eliminates tariffs on Canadian fish exports — some of which were as high as 25 percent. Canadian firms will also have guaranteed access to European public procurement.

In the Brexit negotiations, Britain will ask for as many cherries as it can get.

Canada did not have to accept European Court of Justice jurisdiction or freedom of movement in return (although there are potential sanctions if it violates parts of the deal), so that looks from London remarkably like a form of cherry-picking. The Brits just argue that a U.K. deal should involve juicier cherries since it is starting from a position of maximum alignment.

The lesson, say British officials, is that free-trade agreements are not bought off the shelf — they vary depending on the size and shape of each economy (hence why they take so long to negotiate). They are quintessential exercises in cherry-picking.

In the Brexit negotiations, Britain will ask for as many cherries as it can get. It is up to the EU to name its price.

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